Spending Review Response

Somerset County Council’s Leader said today’s Comprehensive Spending Review has failed to solve the issues around long-term funding of services for vulnerable adults and children.

“Care for vulnerable elderly people and children is being neglected, undervalued and underfunded” said Cllr Osman. “It will take time to really understand the detail, but it’s clear local authorities will be paying the price for protecting spending in other areas like the NHS, police and defence. Of course those services are important, but so is the care of vulnerable children and adults which can also prevent the need for more expensive care further down the line.”

The details of how today’s announcements will affect local authorities won’t be known for several weeks, however, there will be no slowing of the reduction in core funding and no speeding up of crucial changes that would allow them to retain all of the business rates in their local area.

As expected, the Chancellor also announced that local authorities would be able to raise a new charge of up to 2% on Council Tax to help fund the rising cost of adult social care. In Somerset that would raise around £4m. This would be in addition to any other Council Tax increase implemented to protect services.

Cllr Osman said: “A 2% precept wouldn’t even cover the additional costs incurred next year as a result of our ageing population, then you have the costs of inflation and the impact of the National Living Wage. The new precept does nothing to address the fundamental underfunding of the local authorities providing these services, it simply allows councils to put an additional burden on Council Tax Payers.”

Today’s announcement confirms that Somerset’s direct funding from Government – the Revenue Support Grant – will be phased out by 2019/20, falling from around £63m in 2014/15 to zero by 2019/20 at the latest. At the same time, for 2016/17 alone, inflation will add around £3.5m to costs and demographic pressures – a growing and ageing population – a further £5m.

On top of this, the introduction of the National Living Wage in 2016 will be an additional pressure, being an extra burden for the care providers contracted by the Council to look after vulnerable adults.

Cllr Osman added: “Our general reserves – those not already committed – are at the minimum recommended level. This is not a pot for us to dip into to balance the books.”

Earlier this month, Leader John Osman wrote to the Prime Minister, the Chancellor and Somerset MPs spelling out the impact of continued austerity on the Council’s ability to balance its budget while looking after its most vulnerable residents. This followed a freeze on all non-essential spending introduced to help protect Adult Social Care and Children’s Service.

The Council has, however, welcomed the commitment in the autumn statement to overhaul school funding. It has long campaigned for a review to the formula which leaves Somerset’s children receiving considerably less funding per head than many different parts of the country.

Cllr Osman said: “This isn’t a solution but it’s at least, finally, acceptance that there is a problem. We will contribute fully to the consultation that has been announced and do what we can to redress the huge inequality in funding that it penalising Somerset’s young people.”